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- 08 May 2025
- ICICIdirect Research
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TATA CHEMICALS REVENUES GREW 1 PERCENT YOY
News: Revenues grew 1% YoY to ₹ 3509 crore, tracking flat performance in Rallis (15% of the revenues). Ex-Rallis revenues (mainly Soda Ash) stood at ₹ 3079 crore, flat sequentially and up 1.4% YoY. Revenues from North America Soda Ash sales (~43% of the revenues) stood flat YoY to ₹1316 crore, whereas India sales (~38% of the revenues) grew 15% YoY to ₹1146 crore, UK revenues degrew ~25% YoY to ₹417 crore, and Kenya grew ~8% YoY to ₹158 crore. EBITDA declined 26% YoY to ₹327 crore, with margins at 9.3% (down 343 bps), primarily impacted by an EBITDA loss of ₹20 crore in Rallis and margin compression in the North America and Europe regions.
View: Pricing scenario continues to be weak across the world. As per management, the global capacities have increased by ~9% in FY25 against a demand increase of 8.3%, thus leading to significant drop in realisation, although Q4 witnessed some respite in price decline. Current Demand-supply balance continues to be soft, coupled with uncertainties in Soda Ash trade driven by tariff changes. The management expects recovery in the coming quarters to be driven by sustainability applications (Solar PV + EV growth), even with short term margin challenges. The management also expects no more capacity additions globally as the current prices would not be viable for such addition. We continue to monitor the company's efforts towards margin recovery.
Impact: Negative